After the Boeing machinists’ historic and close vote recently, the debate around retirement security continues. With the approval of their next contract to build the 777x here in Washington state, backed-in Boeing machinists voted to eliminate their pensions by 2016 and transfer to a 401(k) retirement benefit system.
The question remains, how equitable is a 401 (k)?
Inequality in the U.S. economy has many dimensions, including inequalities in retirement security. The generation-long experiment in retirement security policy away from pensions to individual accounts—often called the “401(k) revolution”—has been a clear disaster, generating a few big winners and millions of losers: Most American households now face a deeply insecure retirement. Nearly half of households have no savings in retirement accounts, and a household in the 90th percentile of the retirement savings distribution has nearly 100 times more retirement savings than the median household.